The European Securities and Markets Authority (ESMA) has issued a consultation paper on February 17, outlining proposed guidelines to assess the knowledge and competence of staff at crypto asset service providers, in alignment with the EU’s Markets in Crypto-Assets Regulation (MiCA) established in June 2023.
The guidelines aim to set uniform standards for personnel involved in providing advice or information about crypto assets and services. This initiative is part of broader efforts to ensure that all operators in the crypto market are well-informed and capable of advising clients accurately, thereby enhancing investor protection and promoting trust in the burgeoning crypto sector.
Requirements for Crypto Staff
Under the new guidelines, staff members will need to have a thorough understanding of the characteristics and risks associated with crypto assets, market dynamics, and the underlying technology of blockchain. They are also expected to be knowledgeable about the relevant regulatory and tax implications. The guidelines suggest that special attention should be given when discussing complex and volatile crypto assets.
ESMA‘s proposal includes minimum qualifications for crypto staff, such as relevant prior experience, ongoing professional development, and educational degrees in related fields. Crypto service providers will be responsible for conducting annual reviews of staff development needs, supervising untrained personnel, maintaining records of qualifications, and performing regular evaluations of staff proficiency.
The securities regulator is currently seeking input on these proposals and has invited alternative suggestions regarding the competence of personnel advising on crypto investments. The consultation period is open until April 22, with ESMA planning to publish the final guidelines in the third quarter.
Author’s Opinion
The move by ESMA to establish clear guidelines for the competence of staff within the crypto industry is a commendable step towards ensuring that the sector operates with integrity and reliability. By setting high standards for knowledge and professionalism, ESMA not only protects investors but also supports the sustainable growth of the crypto market. Such regulations help to mitigate the risks associated with digital assets and foster a safer investment environment. This proactive approach should serve as a model for other regulatory bodies, demonstrating that thorough understanding and continuous education are crucial in navigating the complexities of modern financial technologies.
